Proposal for Holistic Industrial Wastewater Treatment Program Services

At the request of TVA Supply Chain, the OIG examined the cost proposal submitted by a contractor, for engineering, design, and construction support for Holistic Industrial Wastewater Treatment Program services at TVA fossil plants. Our objective was to determine if the cost proposal was fairly stated for a planned $45 million contract. In our opinion, the cost proposal was overstated. We estimated TVA could save about $3.68 million on the planned $45 million contract by negotiating reductions to the proposed labor markup rates, including labor markup rates for work performed at TVA sites, and negotiating reductions to the proposed escalation rate and fee rate. In addition, we found the contractor did not propose labor wage ranges for cost reimbursable work, as required by the request for proposal. We also identified compensation terms in the draft contract that needed to be revised to reduce the potential for future billing discrepancies.(Summary Only)